Afcons Infrastructure IPO: Shapoorji Pallonji unit to do Rs 5,430-crore IPO on October 25; 10 things to know from RHP

Afcons Infrastructure Initial Public Offering: The main board initial public offering (IPO) of Afcons Infrastructure Limited (AIL), the flagship infrastructure engineering and construction company of the Shapoorji Pallonji Group, will open for subscription on Friday, October 25, 2024, in the Indian primary market. aimed at raising funds $Raised Rs 5,430 crore through Afcons Infrastructure IPO.

The Mumbai-based multinational filed its IPO red herring prospectus (RHP) on Saturday, October 19. , urban infrastructure, hydraulics, underground engineering, and oil and gas projects.

Also read: Afcons infrastructure order inflow hits record high post-IPO

“We have a proven track record of executing numerous complex, challenging and unique engineering, procurement and construction (EPC) projects in India and internationally,” Afcons Infrastructure Ltd said in its RHP today, ending June 2024. On the 30th, Afcons Infrastructure had 65 active projects in 12 countries in Asia, Africa and the Middle East, with a total order book $34,888 Crores.

Afcons Infrastructure IPO: Here are 10 things you need to know about RHP

1.Afcons Infrastructure IPO key dates: The Afcons Infrastructure IPO will open for subscription on October 25, 2024, and the bidding window will close on October 29, 2024. The IPO will be listed on BSE and NSE and the tentative listing date is Monday, November 4, 2024.

2.Afcons Infrastructure IPO price range: The price range for the Afcons Infrastructure IPO has not yet been announced. RHP did not include details on the price range of the public offering, which will be announced soon.

Also read: Afcons Infra cuts offer sizes up to $5,400 cr after top up $3,000 cr before IPO

3.Afcons Infrastructure IPO details: Afcons Infrastructure IPO is a book-entry offering $5,430.00 Crores. A public problem consists of a new problem worth $1,250.00 Crores and Offered Price (OFS) Value $4,180.00 Crores. The upper limit price shall not be lower than 105% of the floor price and shall not be higher than 120% of the floor price.

4.Afcons Infrastructure IPO Appointment: Half of the net public issue size (issue volume minus employee retention) has been reserved for qualified institutional buyers (QIBs), some of which may be allocated to anchor investors. 15% of the shares are reserved for non-institutional investors (NII) and the remaining 35% for retail investors.

5.Afcons Infrastructure IPO Promoters Holding: The company’s promoters are Goswami Infratech Private Limited, Shapoorji Pallonji and Company Private Limited and Floreat Investments Private Limited, which held 99.48 per cent stake in the company before the issue.

Also read: Afcons conservatively told investors it would focus on high-margin EPC projects

6.Lead Manager and Registrar of Afcons Infrastructure IPO: ICICI Securities Limited, Dam Capital Advisors Ltd (formerly IDFC Securities Ltd), Jefferies India Private Limited, Nomura Financial Advisory And Securities (India) Pvt Ltd, Nuvama Wealth Management Limited and SBI Capital Markets Limited are the company’s bookkeeping lead managers Afcons Infrastructure IPO, Link Intime India Private Ltd is the registered agency for the issue.

7.Afcons Infrastructure IPO Objectives: The selling shareholders will receive proceeds from OFS, while Afcons Infrastructure will not receive any proceeds. Goswami Infratech Pvt Ltd, a promoter group company, is selling shares through OFS. Of the total proceeds from the new issue of shares, Afcons Infrastructure intends to use $800 million for capital expenditure on purchase of construction equipment. it will use $320 crore to meet long-term working capital requirements. About $6 billion rupees will be used to repay part of the outstanding borrowings early or as planned. Remaining funds will be used for general corporate purposes.

8.Afcons Infrastructure IPO listed peers: According to RHP, the company’s listed peers include Larsen & Toubro (L&T) (P/E ratio as of March 31, 2023: 48.49), KEC International Ltd (P/E ratio: 97.21), Kalpatarus International Limited (P/E ratio: 97.21), ratio of 36.72) and Dilip Buildcon Ltd.

Also read: Shapoorji Pallonji Group’s infrastructure flagship company Afcons Infrastructure gets SEBI recognition $Rs 7,000 Crore IPO

9.Afcons Infrastructure IPO Main Risks: If an EPC specialist fails to win new contracts from project owners, its business, financial condition, results of operations, prospects and cash flows may be adversely affected. The business relies heavily on projects awarded by governments or government-owned customers, which are subject to various risks. As of June 30, 2024, such projects accounted for 69.80% of order volume.

10.Afcons Infrastructure Finance: Afcons’ restated consolidated operating income for fiscal year 2023 increased by 14.69% to $12,637.38 Crore, above $11,018.97 crore in the previous year. Net profit increased by 14.89% year-on-year $357.6 Crore in FY22 $41,086 crore in FY23. For the six months ended September 30, 2023, operating income was $6,505.39 Crores and Net Profit of Rs. $195.13 Crores.

Afcons Infrastructure Company Details

Over the past 11 financial years and the three-month period ending June 30, 2024, Afcons has completed 79 projects in 17 countries, with a total historical execution contract value of $56,305 Crores. Afcons Infrastructure Limited’s projects cover five major infrastructure business verticals.

Also read: Shapoorji Pallonji in talks to raise $2.4 billion from lenders including PFC

These include marine and industrial projects covering ports, port terminals, dry docks, wet basins, breakwaters, outfall and intake structures, LNG tanks and material handling systems. The projects involve surface transportation and span highways, flyovers, mining-related infrastructure and railways. Urban infrastructure projects include elevated, underground subways, bridges, overpasses, elevated corridors, etc.

Afcons implements hydroelectric and underground works, including dams and barrages, tunnels (including large road tunnels), underground works, water supply and irrigation. Afcons Infrastructure undertakes projects in the oil and gas sector, covering offshore and onshore oil and gas projects.

Shapoorji Pallonji Group was established in 1865 and has diversified business interests in engineering and construction, infrastructure, real estate, water, energy and financial services. The company was criticized for selling its stake in the Gopalpur port brownfield site at enterprise value $33.5 billion rupees. The group said the divestment is a key milestone in leveraging macro trends in core business demand in India and overseas to reduce debt and accelerate growth.